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WHEN YOU CLEAR away all of the obfuscation from presidential campaigns, the entire process comes down to each candidates accusing the others of not being qualified for the office. This was certainly true in the 2000 presidential campaign. And every candidate who said or implied that about his opponents was absolutely right.

No one is qualified to be president. No one.

This is not a statement born of cynicism. Its cold fact. How could anyone be qualified to direct a $2-trillion-a-year behemoth also known as the federal government designed to meddle in the lives of every person in the United States and quite a few overseas as well?

The president of the United States is expected to steer the economy. But this grossly misconceives what an economy is. Its not a ship. The economy is a figure of speech. In reality its just a bunch of people engaged in production and trade. Steering the economy translates into telling people what to do. Aside from the moral issue involved (telling them what to do violates their freedom), no one knows enough to intelligently direct 265 million peoples activities. Steering is a euphemism for some degree of central planning, which is doomed to failure. (For details see the work of Ludwig von Mises and F.A. Hayek.)

Perhaps some readers will think the term central planning is inappropriate for the United States, land of free enterprise. Well, what was the case against Microsoft if not an attempt to centrally plan the computer software industry? The government decreed that Web browsers must not be integrated into operating systems. It was actually worse: the decree applied to only one company. Then-antitrust chief Joel Klein said so. Or how about his decision that MCI WorldCom might not merge with Sprint because a combined company would not conform to his vision of the (quickly vanishing) long-distance telephone industry? The president hires the attorney general, who hires the antitrust chief. Thus to be president is to have some of the powers of a central planner.

Those are just two examples of how the president and his men aspire to plan the economy our lives. The alphabet agencies staffed by the president EPA, OSHA, FDA, FTC, ad nauseum exist to enable social engineers to carry out their visions of our futures. (Thanks, but I have plans of my own, just as everyone else does.) The federal budget these days is little more than a transfer machine set up to induce particular behaviors and to buy off constituencies.

Taxes and spending

Political leaders have a stake in convincing us that they can and do steer the economy. President Clinton feverishly takes credit for the last several years of economic growth. Hed have us believe that his big 1993 tax increase is responsible for all the good things we see in the private sector. (He says he wonders where the doubters think all the jobs came from.) Clinton assumed office several months after a mild recession had ended. The budget was deeply in deficit not because tax cuts reduced revenues in the 1980s (that myth dies hard), but because the government spent well over a buck for every buck taxpayers were forced to pony up.

How exactly was the Clinton tax increase going to turn that around? Their theory is that by showing fiscal restraint and attacking the deficit, the administration reassured the financial community, bringing down interest rates and stimulating economic growth. Nice fantasy. Clinton showed no interest in killing the deficit before the Democrats lost control of the Congress in 1995 (thats when the Dow took off), and then he dragged his feet. He never advocated fiscal restraint: read the State of the Union addresses!

Nonmilitary spending has grown during the eight years. Spending caps are routinely violated under the ruse of emergency. As the Cato Institute points out, the Republicans are accomplices: the 106th Congress is the biggest-spending Congress since the Jimmy Carter-Tip ONeill years.

So what accounts for the prosperity? It cant be that the Clinton program brought down interest rates. As economist Russell Roberts points out, interest rates are higher today than when Clinton took office. Theres simply no connection between budget deficits or surpluses and interest rates for a simple reason: the governments biggest deficits were but a thin sliver of the $25 trillion capital market. The government can do many bad things, but it hasnt managed to borrow enough money to affect that market. The U.S. GDP exceeds $9 trillion.

We should also keep in mind that Clinton failed to get three of the four pillars of his program through Congress. His plan to take over the medical sector (14 percent of the economy) never got to a vote. His spending stimulus package went down in flames, as did his plan for an energy (BTU) tax. (By the way, do you remember when Clinton confessed to a business audience that he had raised taxes too much?).

Prosperity unleashed

Then why the prosperity? Technological innovations made possible by people like Bill Gates, and corporate innovations made possible by people like Michael Milken both of whom are demonized by the Clinton administration. Their accomplishments unleashed the productive efforts of millions of people, which in turn flooded the government coffers with surplus revenues. The tax take is at a record peacetime high. If Clinton and Congress can take credit for anything, its for cutting the capital gains tax in 1997 and for freeing up some international trade, though substantial barriers to free trade remain.

Far from deserving credit for the prosperity, the Clinton bureaucrats still maintain impediments to productive activity and seek to add more. The president cant bear the idea of a tax cut that doesnt compel certain people to act in prescribed ways, and hes always pushing myriad new spending programs.

There was a time when no one would dream that a president was qualified to run the economy. He wasnt expected to. Instead, he was called on to preside over a government possessing the few powers spelled out in Article I, Section 8, of the U.S. Constitution. Mere mortals could handle that job. But maybe it wasnt glamorous enough for the people who aspired to be president of the United States for many of them pushed the limits as far as they could. I have in mind especially Lincoln, Roosevelt I, Wilson, Roosevelt II, and all their political heirs and assigns.

This presents us with an awesome challenge. The federal government was once limited, even if not perfectly. But it was able to break through the limits and gobble up chunks of our liberty. Putting it back in the cage is challenge enough. But the tougher task will be finding a way to keep it there. To borrow a conundrum from philosophy: Can the polity tie a knot so complex that it cannot untie it? I dont know that it can. But we can worry about that after we get the beast caged once again.

Presidents can do a million things to screw up an economy, but they can do only one thing if they want the maximum general prosperity and freedom: leave it alone! Thats what theyre qualified for.

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Sheldon Richman is former vice president and editor at The Future of Freedom Foundation and editor of FFF's monthly journal, Future of Freedom. For 15 years he was editor of The Freeman, published by the Foundation for Economic Education in Irvington, New York. He is the author of FFF's award-winning book Separating School & State: How to Liberate America's Families; Your Money or Your Life: Why We Must Abolish the Income Tax; and Tethered Citizens: Time to Repeal the Welfare State.
Calling for the abolition, not the reform, of public schooling. Separating School & State has become a landmark book in both libertarian and educational circles. In his column in the Financial Times, Michael Prowse wrote: "I recommend a subversive tract, Separating School & State by Sheldon Richman of the Cato Institute, a Washington think tank... . I also think that Mr. Richman is right to fear that state education undermines personal responsibility..."
Sheldon's articles on economic policy, education, civil liberties, American history, foreign policy, and the Middle East have appeared in the Washington Post, Wall Street Journal, American Scholar, Chicago Tribune, USA Today, Washington Times, The American Conservative, Insight, Cato Policy Report, Journal of Economic Development, The Freeman, The World & I, Reason, Washington Report on Middle East Affairs, Middle East Policy, Liberty magazine, and other publications. He is a contributor to the The Concise Encyclopedia of Economics.
A former newspaper reporter and senior editor at the Cato Institute and the Institute for Humane Studies, Sheldon is a graduate of Temple University in Philadelphia. He blogs at Free Association. Send him e-mail.

Reading List

Prepared by Richard M. Ebeling

Austrian economics is a distinctive approach to the discipline of economics that analyzes market forces without ever losing sight of the logic of individual human action. Two of the major Austrian economists in the 20th century have been Friedrich A. Hayek, who won the Nobel Prize in Economics, and Ludwig von Mises. Posted below is an Austrian Economics reading list prepared by Richard M. Ebeling, economics professor at Northwood University in Midland and former president of the Foundation for Economic Education and vice president of academic affairs at FFF.